After a spate of bad news for Macau that has included UnionPay’s annual cap on cash withdrawal and Neptune’s reported half year losses, Morgan Stanley says it retains a cautious view on the gaming industry but that the news is not as bad as it seems.

It was recently reported that UnionPay would limit Chinese debit card users to withdraw cash up to RMB100,000 ($15,700 per card annually overseas from January 1, 2016.

There is no change to the daily limit of Rmb10,000 cash withdrawal, unlimited debit card usage through swiping and up to RMB1 million credit limit per card.

MS says this is negative for regular premium mass players who withdraw cash from ATM machines to buy chips from cage or tables and were frequent visitors.

“For others, it is not as bad. Most customers have several cards and are also using pawnshops/credit cards to access cash for gambling with no additional restrictions. On a relative basis, this impacts Macau more than other global tourist destinations where Chinese visitors can swipe the card to buy merchandise.”

In a separate news story, Neptune reported a net loss of HK$959mn in 2HFY15 (ending June) – LBITDA came at HK$1bn, due to impairment loss of trade receivables and intangible assets.

The group wrote off investments in Sands Macao, Venetian and Grand Lisboa junket business. They also closed down 22 tables at StarWorld and now operate only 59 tables – 3 percent of the total VIP tables in Macau.

Neptune Group (including unlisted entity) had over 10 percent market share of the junket VIP business.

“We believe this is negative for VIP business in Macau, which we expect to decline by 47%/7% in 2015/16, but somewhat backward looking.”

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